News & Articles Malaysian property developers in UK unfazed
Malaysian property developers in UK unfazed
29 Jun 2016
KUALA LUMPUR: Although Malaysian property developers with projects in the United Kingdom will be affected by the UK’s exit from the European Union, they feel they can weather it.
It is anticipated that the economic uncertainties surrounding Brexit could result in a drop in sales of properties in England.
CIMB Research and Affin Hwang Capital noted that the uncertainty created following the decision, in a referendum, by the people of UK to leave the EU would likely dampen the market.
CIMB said the uncertainty generated from the time of the vote to the actual day the UK quits the EU, expected to take more than two years, might deter foreign investment into the London property market.
“Foreign interest may recover afterwards, but the extent of the recovery will depend on the terms agreed,” a report in PropertyGuru quoted CIMB Research as saying.
Malaysian developers with exposure to the UK include Sime Darby Bhd, SP Setia Bhd, Eco World Development Group Bhd and Eastern & Oriental Bhd (E&O).
Sime Darby does not expect the results of the referendum to affect the viability of its Battersea Power Station project in London. The company believes that the development will continue to generate interest in the longer term, with London remaining as a key investment destination and financial centre, according to the report.
The Battersea project is 40 per cent owned each by SP Setia and Sime Darby, while the Employees Provident Fund owns the remaining 20 per cent.
E&O managing director Terry Tham was quoted by PropertyGuru as saying E&O’s three projects in the UK were expected to progress as planned as they maintained a “flexible and agile stance in the face of any changes in the market environment”.
Affin Hwang Capital said the uncertainties due to Brexit concerns had delayed the company’s plan to list its UK operation on the AIM market. Also, it said, the translation of its £54.5 million (RM300.12 million) loans to its UK subsidiary into Ringgit could lead to unrealised foreign exchange (forex) loss of about RM47 million in the fourth quarter of 2016.
The report quoted Credit Suisse as noting that Eco World International (EWI), in which Eco World Development Group Bhd will eventually own a 30 stake, had a big exposure in the UK.
It is anticipated that the economic uncertainties surrounding Brexit could result in a drop in sales of properties in England.
CIMB Research and Affin Hwang Capital noted that the uncertainty created following the decision, in a referendum, by the people of UK to leave the EU would likely dampen the market.
CIMB said the uncertainty generated from the time of the vote to the actual day the UK quits the EU, expected to take more than two years, might deter foreign investment into the London property market.
“Foreign interest may recover afterwards, but the extent of the recovery will depend on the terms agreed,” a report in PropertyGuru quoted CIMB Research as saying.
Malaysian developers with exposure to the UK include Sime Darby Bhd, SP Setia Bhd, Eco World Development Group Bhd and Eastern & Oriental Bhd (E&O).
Sime Darby does not expect the results of the referendum to affect the viability of its Battersea Power Station project in London. The company believes that the development will continue to generate interest in the longer term, with London remaining as a key investment destination and financial centre, according to the report.
The Battersea project is 40 per cent owned each by SP Setia and Sime Darby, while the Employees Provident Fund owns the remaining 20 per cent.
E&O managing director Terry Tham was quoted by PropertyGuru as saying E&O’s three projects in the UK were expected to progress as planned as they maintained a “flexible and agile stance in the face of any changes in the market environment”.
Affin Hwang Capital said the uncertainties due to Brexit concerns had delayed the company’s plan to list its UK operation on the AIM market. Also, it said, the translation of its £54.5 million (RM300.12 million) loans to its UK subsidiary into Ringgit could lead to unrealised foreign exchange (forex) loss of about RM47 million in the fourth quarter of 2016.
The report quoted Credit Suisse as noting that Eco World International (EWI), in which Eco World Development Group Bhd will eventually own a 30 stake, had a big exposure in the UK.
Source: freemalaysiatoday.com